tv Nightly Business Report PBS August 5, 2013 6:30pm-7:01pm PDT
this is nightly business report with tyler mathisen and suzie garrett. brought to you by -- >> you get close to iconic landmarks, viking river cruises, exploring the world in comfort. media shocker. the washington post company sells its number and publishing assets to amazon.com founder. the deal capped the day of big news in print, online and in television. >> looser lending. new reports say banks are lowering standards for businesses, consumer and home buyers. does it signal a return to the
bad old days of too easy credit? >> home grown, walmart pledges to buy american made goods. how it could affect manufacturing. we kick off a special series called made in america. >> it was a stunning late day capper today to a day of major news affecting the newspapers you read, the websites you visit, the tv networks you watch, and the cable systems you may subscribe to. amazon.com founder and ceo is buying the publishing business of the washington post company. which includes the fames newspaper for $250 million. the post long run by members of the eugene meyer and graham families reached the peak of its fame for tough reporting, during the watergate era. baso says, i understand the
critical role the post plays in washington, d.c., and our nation, and the post's values will not change. according to an sec filing, the rest of the company will change its name within 60 days of the deal's closing and investors like the news. they sent shares of washington post higher after hours. another media legend. newsweek, once owned by the washington post company was sold again. this time to ibt media. this is the all digital news publisher of the international business times. the price and terms of the deal were not disclosed. the weekly news magazine that publishes online only was owned by barry diller's iac interactive corp. they plan to grow the online franchise with readers worldwide. deal number three, the owner of the boston red sox is now the owner of the boston globe, john henry purchased the paper from the new york times company for the bargain price of $70
million. the deal includes the globe's website and boston.com site, the price tag is just a fraction of the more than $1 billion. the new york times company paid for the newspaper two decades ago. and in the world of television today. time warner cable made a proposal to cvs to end their fee dispute. glenn sent a letter to le les moonvez giving consumers a chance to pay ala carte. in the interview, the incoming ceo robert marcus said he wants to make a deal. >> we're as anxious as anyone to restore cbs programming to our lineup, and ensure customers have access to it, the key really is, we need to do so at a fair price and on reasonable terms for our customers. >> no word yet from cbs.
shares of time warner cable ended the day higher, shares of cbs down more than 1%. joining us now to talk more about this rapidly changing media landscape is jason blair. media 12re analyst with the advisory group. good to have you with us. why don't we start with the time warner cbs spat and we'll work our way back through some of these other stories. what time warner said is, you don't like our offer to pay you for retransmission rights to carry your stations as part of a bundle. how would you like it if we charge basically on a per customer basis and you have to sell yourselves to all of our customers system wide? do i have that right and will cbs ever accept it? mr. blair, obviously we're having issues with his audio, we'll try to bring him back a little later in the meantime, let's move on to wall street.
for a while, it looked like economic data showing the services sector might set the tone, that failed to take hold with a lack of any conviction. the dow had its worst day in more than a month. the dow falling 46 points, the nasdaq did manage to add three points. briefly touching a new 13-year high. the s&p 500 was off two and a half, still, it stayed a little bit above 1700. weighing on the market, comments from the top federal reserve official saying the central bank is closer to slowing its stimulus program. richard fisher, president of the federal reserve bank of dallas, and one of the most critics warned investors that the fed should make its first move to pull back on its massive bond buying program in september. for months now, policy makers have been debating the issue on the pace and timing of any cuts to monitor stimulus. 23 you're in the market for a loan, you may be in luck.
the nation's banks eased restrictions on everything from bids to consumer loans in the second quarter. helping meet an increase in demand. nearly 20% of those questioned report that credit standards had eased at least somewhat for larger and mid sized firms. as for householdses, 10% of banks eased revisions. it's getting easier for home buyers. the mortgage banker's session says there's been an increase in lending to people with lower credit scores. it may be because rising mortgage rates are making it more difficult for lenders to find business. >> you would think that as buyers return to the housing market, mortgage bankers would be busier than ever, but that is not the case. mortgage applications are now down 47% from a year ago, driven by a 59% drop in refinances. a direct result of the sharp
jump in mortgage rates. bankers who had been struggling to keep up with demand are now suddenly seeking it, and to get it, they are easing up on the underwriting. >> credit availability rose 2.2% in july month to month, and is up 3% from may, according to a new survey from the mortgage bankers association. the increase was driven by more cash out refinancing and more loans for borrower's with larger loan balances or lower credit scores. a federal reserve survey of senior loan officers reported the same. >> lenders had a huge backlog of high quality refinance loans that they finally worked through. during that time they may not have focused on other loans. >> a nonbank lender in maryland says quality control is tight, but they put extra constraints to keep up with the rephi boom. >> as rates as risen and the
refi volume has dropped, they're turning their attention to other borrowers. >> refinances are 63% of all mortgage applications, they had hit a high of 84% in december of last year, when mortgage rates hit new record lows. one of the biggest changes noted in the mortgage banker's report is that cash out refi's are coming back, as home prices rise, home equity returns. despite getting burned before, so many borrowers are willing to pull cash out of their homes the minute it comes back in. diana olick, washington. >> for more of this story, log on to our website. an outspoketh regulator wants banks to get out of the commodities business. they're calling on the federal reserve to allow banks to offer
metal warehouses. banks have a conflict of interest when they control the supply of the same commodities they trade. >> meanwhile, goldman sachs and the london metal exchange are being sued over their commodities warehousing business. the class action lawsuit complains about rising metal prices because of long waiting times at warehouses. last week, goldman sachs says it was taking steps to make aluminum more immediately available to customers. u.s. federal energy regulators are going after alleged market manipulators. today the regulartory commissio threatened to fine bp of $20 million. accusing the traders of manipulating the market. bp says the allegations are without merit. chevron will pay $2 million in fines for last year's massive
refinery fire in richmond, california. the oil company also pleaded no contest to charges of violating the state's health and labor codes. investigators blamed the fire on a corroded pipe that burst. the fire sent thousands of people to the hospital, most complaining of respiratory problems. protesters were arrested this weekend in a demonstration to mark tomorrow's one-year anniversary of that fire. microsoft is making another price cut, this time for its tablet surface pro, the company is offering a $100 discount. the move am coulds weeks after slashing the price of its less powerful surface rt by 30%. last quarter, microsoft took a $900 million write-off on unsold surface inventory. apple's share of the tablet market fell sharply in the second quarter. apple's ipad accounted for one third of the tablet market, that's down from 60% a year ago. it's still the top single seller
in its group. speaking of apple, apple got an assist from washington today, president obama overturned an order from the u.s. international trade commission banning imports of older iphones and ipads, which the agency said violated samsung patents. the ban would have begun today. the u.s. trade representatives says the veto was based on considerations that could have an effect on competitive conditions in the u.s. economy and their effect on the u.s. consumer. the last time a president overturned a trade ban, ronald reagan back in 1987, a case involving samsung. jet blue's days as a coach only carrier are numbered, the airline is changing course, going after the first class flyer. will it pay off? first, let's take a look at how the international markets closed today.
european authorities have signed off on usairways, proposed merger with american airlines american parent company. as expected the approval comes on the condition that american eagle give up one slot at london's heathrow airport. the combination would create the world's biggest airline and must be approved by a federal judge before amr can emerge from bankruptcy. >> more people are taking to the skies on usairways. passenger traffic on the airline rose more than 6% in july, and it comes as the carrier continues to increase its
capacity. usairways which operates usairways shuttles has been optimistic about the strength of travel demand. jet blue is changing its strategy, making a play for the first class or business class flyer. they plan to offer private suites and live flat seats on cross country flights. will it take off with travelers? >> reporter: the travel industry hasn't had a lot to celebrate the last few years, but to fight flat sales, airlines are introducing more flat seats where the money is, in business class. >> the business traveler continues to trend up. >> at the largest gathering ever, delta and jet blue unveiled new business class seats, it's the first business class ever for jet blue, this is one part of the airplane where sales are growing. >> that's prime money for the airlines. >> business travel in the u.s. is expected to grow 4.5% this
year, to $273 billion. but the number two market, china, is expected to grow much faster and in fact double spending by 2017 over taking the u.s. as the number one market. >> you have major competition coming from the united states coming from the big carriers, meaning united, american and delta, all making big investments trying to make more seats, more routes in china. >> today's business traveler wants mobil travel help on the go. >> you're getting off an airplane, flight's been cancelled, meeting's been delayed, you can click to call an agent right away, they'll be prebriefed with everything about your trip. >> we're also finding that companies are looking to be cost efwektive what their travel spends. >> at the same time, the global threat alert is allowing many of these travel management companies for new tracking and highlights on the road. >> where are my people, how do i communicate with them. how do i track their progress to
safety. and how do i ensure they're safe and sound. >> travel rebounds from the great recession, it does so in an ever dangerous world. >> in a global economy, you know that you do have a higher risk profile than maybe in years past. it's a fact of life, and we all deal with it about. >> we begin our market focus tonight with a big earnings beat. tyson foods, quarterly profits sored on strong demand for chicken and rebound for its meat business. they were able to offset high feed costs with a rise in prices. sales for the next fiscal year would be higher than estimates. the stock hitting multiyear highs hitting up 4%. a different story for ew scripps, earnings plunged 41%. the company blamed the drop in revenue on a decline of political adds. the stock tumbled almost 11%, to
14.87. >> concern over a slowdown in the smart phone market leading to a downgrade of eququalcomm. demand was falling for components used in high end smart phones. the stock finished the day fractionally lower, 66 and a quarter. another downgrade today, this one for the fashion accessory's retailer, fossil. barclay's cut its rating on the stock. the firm says it's channel checks indicate sales have slowed, despite management's view that sales will accelerate in the second half of the year. the stock fell 6% today to 107.42. we fixed our technical problems, let's get back to jason blair. i was asking you jason whether you thought cbs would ever accept the proposed deal from time warner cable to go on an
ala carte pricing plan rather than being part of a bundle. do you think they will? and do you think ala carte pricing is just over the horizon. >> that's a good question. i think time warner's offer is designed to educate their subscribers. it's a serious offer, but it's an offer that cbs can't accept. the reason for that is, as a homeowner, i'm offered to paid 4 or $5 a month for cbs, i'll just opt to go buy a $12 antenna, and it's a one-time cost to me. the challenge is, in the early 1990s, congress passes the cable ability. that was a time when it was worried that broadcasters like abc, nbc and cbs would fail because the cable bundle was getting so powerful. they were at that time either given must carry or they could
negotiate for retrans. because of these types of laws, the cost of content is growing so rapidly, that a lot of households can't afford to buy pay tv. >> it seems what's going on about all the stories we just reported, we're at an inflexion point in media. and there are going to be new combinations, mergers and sales, whatever, who do see in this media space are the winners and who are the losers, whether it's in tv or print or online. >> sure. well, one of the things we look at is the growth of average residential broadband speeds. you go back to 1983, the average speed of download that we got at our homes has risen at a growth rate of 65%. that's a 65% increase every year. today the average broadband speed is around 20 megabits. we should expect it to be 300 or
400 megs in five years. you couldn't -- competitors couldn't distribute that product. all that content has gone online, and what has protected them has been eroded. the winners are likely to be programming scale, and in the case of an amazon, so as you mentioned, jeff is now buying the washington post company, he's inyesterdayably powerful competitor, especially because he gives television content away to his prime subscribers for free. >> thank you very much. anyone who brings his own rabbit ears, we appreciate it. >> thank you. coming up on the program, is made in america a profitable and smart business strategy? walmart is proving it can be, as we kick off our special series, made in america. but first, let's get a check on how commodities, treasuries and currencies perform today.
walmart wants to bring back more made in america. the decision by the world's largest retailer could make a big difference for the economy and jobs, especially manufacturing jobs. tonight in the first of our special series, made in america. mary thompson looks at the walmart economy. >> here in fayetteville, arkansas, new orders are pouring in. the factory has added 60 full time jobs this year, to produce an additional 10 million candles discontinued for shelves at walmart. >> before our deal with walmart, our business was slow.
>> reporter: walmart plans to buy $30 million this year alone, by 2017 the retail giant projects that number will hit 45 million. walmart has pledged to buy $50 million in american made products in the next ten years. they're partnering with hilg automated companies that use raw materials found right here in the u.s. the economics don't start at the end of the factory line. >> this is not a put an american flag or label on a product and let it sit on the shelf. this has to be proven with customer demand and movement. >> how many more jobs might be created if walmart buys $50 billion more of american made can't els? an estimated 100,000 jobs. more jobs at a time when overseas wage increases and higher shipping costs are making
domestic manufacturing more attractive than ever. walmart is not going it alone. factories have to update their facilities to accommodate more orders, so the push to buy american, would be more viable long term if additional retailers were to get on board. burt hannah says he's already getting calls from other outlets. >> i think it's our responsibility to try to keep the jobs here in america, and figure out a way to do it. >> for nightly business report, i'm mary thompson. he's a three time american league most valuable player. the biggest in the history of baseball, and he is also the most polarizing figure in the sport. alex rodrigez was suspended today by major league baseball for 211 regular season games through the 2014 season. part of baseball's most sweeps drug scandal punishment yet. a total of 12 other players also
suspended. 50 games each. a. rod's suspension comes amid performance enhancing drugs. the media have been taking shots at a. rod for weeks at new york newspapers and fans are among those voicing their opinions. >> this is about fairness, sportsmanship. it's about tradition. you do drugs, you're out. >> if i screw up in my job, i get fired. no one comes back to me. i got to fight for unemployment after that. what are these guys, special? >> i think what -- it is actually cheating. and probably should be banned. >> he should definitely be suspended. >> not banned, though. he brings a lot to the table. >> he should be suspended. not for life, but maybe a year. >> that's what he got. >> rodrigez will appeal the suspension allowing him to play for now, maybe even tonight. if the suspension sticks, he could lose more than $30 million in salary.
that's reactions from people on the street and comments from everyone on the street. it's a very visceral response. we'll see what happens in chicago tonight. >> that is nightly business report for tonight. >> thanks so much for watching. on behalf of your public tv station, thank you for your support. good night, everybody, we'll see you back here tomorrow night. sailing through the heart of landscapes on a river. you get close to local life, cultural treasures. viking river cruises, exploring the world in comfort.